Investment Adviser’s report

New investments lay the foundations for future growth

Oakley’s investments during the period reflect its ongoing commitment to backing exceptional founders and management teams at disruptive, fast-growing businesses.”

Steven Tredget Partner at Oakley Capital.

Watch video: Results 2025

Number of new investments

Oakley Funds completed six new portfolio investments in H1 2025, deploying £54 million into new platform deals.

Realised returns

3.9x & 52%

Across all funds since inception, realised gross returns are 3.9x and average realised gross IRR is 52%.

Market backdrop

Reading the headlines at the start of the year, one could be forgiven for feeling downbeat about the global private equity sector. Worldwide, M&A volumes continued to drop in the first half of the year, falling 9% year-on-year. However, what the media was less explicit about were the marked regional differences. In Europe, the picture is more positive, with shocks from US tariffs more contained as trade deals are agreed and central banks cut interest rates. This, combined with Europe’s arguably more stable political and regulatory environment, has attracted fresh interest from private equity investors eschewing the US in favour of a relative safe haven this side of the Atlantic. As a result, Europe was the only region to see growth in the number of private equity transactions in the second quarter, with 13.5% growth year-on-year.

Europe presents a deep pool of mid-market opportunities for private equity. More than 90% of companies in the region with a turnover of €100m+ are privately held, and these businesses can often be substantially undervalued. As they seek to expand in a more challenging environment where debt is more expensive, their founders and management teams are increasingly drawn to experienced partners who can provide not just capital but experience. It is therefore no surprise that the mid-market has led European fundraising, having already raised 75% of 2024’s total by the end of this half-year period.

Steven Tredget Partner at Oakley Capital

Net debt/EBITDA ratio

4.2x

At the period-end, the average net debt to EBITDA ratio of the Oakley Funds portfolio stood at 4.2x (the PE industry average is between 5x and 6x).

EV/EBITDA multiple

16.3x

EV/EBITDA multiples remained relatively stable throughout the period, reflecting limited movement in industry-wide multiples due to persistent macroeconomic challenges and ongoing global uncertainty.

While broader challenges for private equity persist, for managers offering the right expertise, a strong local presence and a proven track record, the outlook is positive. The dynamic in Europe naturally means greater interest from large, global or US private equity managers as they diversify away from the US. In Q2, US participation in European deals increased to 19%, up from 16.8% in 2023. While these recent arrivals mean more competition for assets, for European mid-market specialists such as Oakley, it highlights our unique advantage: our two decades of proven success in the region.

Oakley’s Capital’s progress

In the first half of this year, Oakley and OCI have been particularly successful with a number of notable achievements. The underlying portfolio has continued to deliver growth, with OCI’s 7% increase in Total NAV Return per share demonstrating continued momentum. Oakley also enjoyed considerable success in its fundraising, the deployment of capital into compelling opportunities and the delivery of realisations.

Robust portfolio performance

In a period in which all companies continued to face a number of macroeconomic challenges, it was reassuring to see the portfolio deliver solid growth, with some standout performers across all four sectors that Oakley invests in. The successful sale of vLex was a testament to Oakley’s ability to create value and was a significant contributor to performance.

Notable growth in the portfolio was achieved by TechInsights, which benefitted from increasing demand for advanced analysis and intellectual property services in the highly competitive technology sector. Phenna Group continued to expand via acquisition, adding to its portfolio of testing, inspection, certification and compliance services, while Bright Stars saw strong demand for its premium UK early learning centres. Facile was another strong contributor as it continued its successful penetration of Italy’s fast-growing online price comparison market, with Dexter’s also expanding its leading position within the London real estate market via a further seven acquisitions as part of its buy-and-build strategy.

In aggregate, the portfolio reached a NAV of £1,275 million, with Total NAV Return per share of +49 pence since 31 December 2024.

Fundraising

In March, Oakley announced the record close of its sixth flagship fund, raising €4.5bn in just six months. Fund VI will follow the same investment strategy that has underpinned Oakley’s strong returns to date, namely investing behind fast-growing, mid-market, private European businesses led by exceptional founders. Fund VI enjoyed strong demand from existing investors and also attracted new institutional capital from across the globe, including commitments from Europe, North America and Asia, as well as from new regions including Australia and Latin America. This success, in a challenging fundraising environment and coming just two years after Oakley raised €2.85bn for Fund V, demonstrates institutional investors’ confidence in our strategy, including our ability to create value and consistently deliver growth.

Realisations

Oakley has continued to demonstrate why investors’ confidence is not misplaced, most notably with the successful sale of its investment in Legaltech platform vLex to Canadian legal software business Clio, which is expected to complete in the second half of the year. The deal values vLex at $1bn, making it one of the few Spanish tech start-ups to reach unicorn status. With Oakley’s support, vLex successfully penetrated new international markets, particularly in the US, where Oakley leveraged its experience in helping founders create transatlantic leaders. Most notably, the acquisition of Fastcase helped double vLex’s revenues. vLex’s partnership with Oakley also enabled the company to capitalise on rapid developments in artificial intelligence (‘AI’), pivoting its business model to launch ‘Vincent’, an AI-powered legal workflow platform that enhanced the company’s proposition to clients and transformed its growth prospects. vLex now serves the majority of the top 100 law firms, and with Clio’s highly complementary services is well positioned for further growth. Oakley is partially reinvesting in the combined business to benefit from this future growth potential, while the success of this investment is already helping Oakley attract interest from other founders who need similar support. That the successful sale of vLex was achieved with a significant uplift to NAV, with a holding period of approximately three years, underscores Oakley’s ability to create value while demonstrating alignment with prevailing market conditions.

Steven Tredget Partner at Oakley Capital

Investments

Oakley’s investments during the period reflect its ongoing commitment to backing exceptional founders and management teams at disruptive, fast-growing businesses. As the pace of digitalisation accelerates, the importance of robust cybersecurity measures only increases, and Fund VI’s acquisition of G3, a leading global strategic advisory company enjoying strong demand for its cyber advisory, corporate due diligence offerings and strategic advisory services, highlights our focus on this exciting sector. Underlining our recognition of the opportunities in this field, we also invested in Bridewell, the UK’s leading independent cybersecurity provider, which is joining forces with existing portfolio company I-TRACING, which leads the field in its native France. Bringing together the two businesses paves the way to creating a European champion in the sector, well positioned to take on legacy providers.

The Origin strategy continued to deliver, investing in Infravadis, a tech-enabled platform focused on the >€25 billion European Underground Infrastructure Maintenance market, which has lagged behind some infrastructure sectors in digitalisation and remains highly fragmented. In Italy, Origin’s investment in JBMC, a fast-growing, founder-led management and IT consultancy firm focused on addressing digital gaps in Italy’s Financial Services industry, continued Oakley’s drive to partner with market disruptors. To learn more about these investments, see New investments in 2025 section.

Following the period-end, Oakley announced the signing of a trio of new investments for its Iconic BrandCo, adding luxury heritage brands Smythson, Fornasetti and Fabbrica Pelletterie Milan to its existing portfolio of Alessi, Globe Trotter and Connolly¹. Drawing upon Oakley’s experience in this sub-sector, our objective is to significantly grow these brands by accelerating their international expansion, digitising operations and enhancing their digital marketing. See Consumer spotlight for more about Iconic BrandCo.

The first half also saw continued success amongst our Venture Funds. As AI continues to drive fundamental shifts in almost every aspect of business, Touring Capital made three new investments in cutting-edge enterprise software companies that are harnessing the technology’s power. Following the period-end, Touring Capital held its final close with final commitments of $294 million. Given the strong early performance of the Touring Fund and the opportunity to increase its commitment at the final close, post period-end the Board applied for a $15 million increase in OCI’s original commitment to Oakley Touring I. You can read more about Touring Capital here. PROfounders also continued to successfully deploy capital, making a new investment in Capalo AI, which is optimising energy storage systems to accelerate the transformation into the clean energy era. You can read more about PROfounders here.

1. The acquisition of Fornasetti completed in June 2025. The Smythson and Fabbrica Pelletterie Milan acquisitions completed in July 2025.

Current deal origination opportunities

570

Oakley Capital is currently tracking 570 potential deals across its four core sectors.

Buy-and-build acquisitions

>40

Oakley's portfolio companies acquired >40 bolt-on businesses in H1 2025.

Oakley’s European advantage

This diverse group of investments not only reflects sectors where Oakley has long-standing experience, it represents the strength of our local expertise. Having ‘boots on the ground’ in the countries in which we invest is incredibly important. This local presence means we are attuned to the intricacies of individual geographies and truly ‘plugged in’ to local markets, meaning we can swiftly act upon any developments. It not only allows us to support portfolio companies operationally, but it also underpins our ability to source new investments, with these established relationships a critical advantage as Europe sees an influx of interest from larger global investors seeking new opportunities in the region. Today Oakley has offices in London, Milan, Munich, Luxembourg, Madrid and Bermuda, and we will continue to look at opening new offices in markets where we are increasingly active and see growing opportunities within our target sectors.

Our local presence also enables us to build close relationships with founders and management teams, sometimes long before they have fully considered or are willing to take on outside investment. These relationships form the bedrock of future partnerships, giving founders confidence that Oakley understands their market and business, and that it has the right skills, experience and international footprint to deliver their growth ambitions.

Pipeline strength

Oakley’s European pipeline is stronger than ever, thanks to our enhanced origination efforts and our broader geographic reach. We are now seeing increased opportunities across France, Italy and Germany and across our core sectors. But even with this expanded pool of targets, Oakley continues to benefit in deal negotiations from its reputation and track record as the partner of choice for founders, securing partnerships at attractive valuations. As always, our focus remains on identifying and targeting a selected number of high-growth, asset-light businesses with strong EBITDA margins, recurring revenues and proven resilience in varied market conditions.

The Business Services sector continues to grow as a key source of investment opportunities, notably in the sub-sectors of Professional Services and Technical Services, where regulatory tailwinds and outsourcing trends underpin strong organic demand, while fragmented markets provide opportunities for industry leaders to drive consolidation in their markets. Technology also remains a significant and diverse proportion of the pipeline, with a focus on specialist mission-critical software solutions that benefit from strong digitalisation tailwinds, recurring revenues and scalability.

In the Consumer sector, investment opportunities are highly targeted and aligned with structural growth themes such as health and wellness and digital marketplaces, where we already have significant expertise and a strong track record. Our highly selective approach to the Education sector is seeing Oakley targeting more EdTech and education software companies, along with corporate or professional training providers, that benefit from a non-cyclical demand for up-skilling, online assessment platforms and digital education services.

Sustainability as a value creation lever

Sustainability is integral to Oakley’s strategy, and we increasingly see it as a key growth driver. In the period we published our fourth Responsible Investment Report, which details our efforts to implement and facilitate peer learning, building sustainability-related knowledge across the portfolio. Highlights from the report include TechInsights’ launch of Ecolnsights, a data-driven sustainability solution, and new revenue stream, which provides emissions reporting for clients to support their carbon reduction efforts across the semiconductor value chain. Meanwhile, Steer Automotive has been breaking new ground as it expands its recycling initiatives, incorporating green and reclaimed parts into its repair operations.

Oakley has also been supporting portfolio companies on the issue of cybersecurity, reflecting our knowledge of the industry not just as an asset class but as an essential business function in an era of increasing and highly damaging cybercrime. As a result, we have rolled out a portfolio-wide cybersecurity monitoring programme, helping management teams assess vulnerabilities and build more resilient IT infrastructures, sharing knowledge and insights from across the portfolio. We have also implemented further initiatives focused on energy and climate change and employee culture, with continued data collection and knowledge sharing across the portfolio. These efforts enhance operational resilience, support long-term value creation and align with evolving stakeholder expectations.

Outlook

Clearly, the environment we operate in is throwing up new challenges and complexities. However, we are confident our proven strategy and disciplined approach mean we can navigate the uncertain environment and continue delivering growth.

With a sizable pool of dry powder, accumulated through Oakley’s recent fundraising success, we remain well positioned to capitalise on our strong pipeline of investment opportunities and favourable conditions for capital deployment. Yet our approach remains highly selective and disciplined. We only back truly exceptional businesses, typically founder-led, operating in sectors we know well and offering meaningful potential for long-term growth.

Our existing portfolio companies continue to perform well, backed by Oakley’s hands-on operational support and by structural tailwinds in their markets. With recent acquisitions already making an impact, we expect this performance to translate into further NAV growth and increased realisation activity.

With Europe now at the forefront of global private equity activity, Oakley’s local presence, network and track record give us a significant advantage, positioning us to build on the current momentum and deliver strong outcomes for OCI shareholders.

Steven Tredget Partner at Oakley Capital
10 September 2025